at the center of asian · pdf fileat the center of asian growth pakistan becoming asia’s...
TRANSCRIPT
At the center of Asian growthPakistan becoming Asia’s trade, energy and transport corridor
##
UAlmaty
FrunzeKazakhstan
Pakistan becoming Asia s trade, energy and transport corridor
# #
#
#
Kashi
Dus hanfe
Toshkent
Samarkand
Ashkhabad
Uzbekistan
Turkmenistan
Kyrgyzstan
TajikistanLand locked energy rich
Booming & energy#
#
##KabulHerat
Mashhad
Islamabad
China
Jum mu & Kas hmir
energy rich Central Asia
energy deficit China
##
####
#
#
Yaz dLahore
Zahedan
AmritsarQandahar
Rawalpindi
Faisalabad
Iran Pakistan
AfghanistanKas hmir
(Disputed Territory)
##
#
# ##
## #
#
Delhi
Patna
JaipurKanpur
Luc know
Benares
New Delhi
Kathmandu
HyderabadIndia
Nepal
Booming SouthCapital &
Energy surplus
2
# #
#
#
#
#
N
MasqatKarachi
Ca
Abu Zaby
Ahmadabad
Omanab Emirates
Booming South Asia
Energy surplus Middle East
Liberal investment policy▪ Equal treatment of local & foreign investorsEqual treatment of local & foreign investors
▪ All economic sectors open to foreign investors
▪ Foreign equity up to 100% allowedg q y p
▪ No Government permissions required
▪ Attractive incentives package
▪ Remittance of capital, profits, royalty, technical & franchise fee allowed
▪ Import of raw material for export manufacturing zero-rated
▪ Bilateral Agreements
– Investment Protection: 47 Countries
– Avoidance of Double Taxation: 52 Countries
▪ Protection of foreign investors through the;
F i P i t I t t (P ti & P t ti ) A t 1976– Foreign Private Investment (Promotion & Protection) Act 1976
– Protection of Economic Reforms Act 1992
Doing business in South Asia 2010
Ease of doing businessRanking
137133129120119
1061021028785
1
Singapore Pakistan China Sri Lanka Egypt Bangladesh Russia Brazil India Iran
Home to over 700 companies
Haier
Deutsche Bank
Reform Process
Government strongly committed to restoring macroeconomic stability as well as the confidence of markets and investors
Comprehensive & integrated medium term strategy evolved – “9-point”program to increase productivity, efficiency & high growth rates1) Macroeconomic Stabilization)2) Social Development, including Social Protection3) Agriculture Productivity Enhancement, Agribusiness and Agro
Process Promotion and CompetitivenessProcess Promotion and Competitiveness4) Industrial Competitiveness5) Human Capital Development6) Energy7) Capital Markets8) Public Private Partnerships for Infrastructure8) Public-Private Partnerships for Infrastructure9) Institutional/Governance Reform
Pakistan’s Economic Overview
2.1 % GDP growth (2008-09).
FDI Inflows during 2008-09 ($ 3.7 billion)
Exports during 2008-09 ($ 17.79 billion)g ( )
Imports during 2008–09 ($ 34.82 billion)
Forex Reserves ( July 2009) $ 12.23 billion
Worker’s Remittances during 2008-09 ($ 7.81 billion) g ($ )
4.7 % growth in Agriculture Sector (2008-09)
Cont’d….
Pakistan’s Economic Overview
(-10.8) % growth in Construction Sector (2008-09)
3 6% th i S i S t (2008 09)3.6% growth in Service Sector (2008-09)
(-3.3) % growth in Manufacturing Sector (2008-09).
(-7.7) % growth in Large Scale Manufacturing Sector (2008-09).
7.5 % growth in Small Scale Manufacturing Sector(2008-09)
1.3 % growth in Mining & Quarrying Sector (2008-09).
Total investment 19.7 % of GDP for 2008-09 against 22 5 % f GDP f 2007 0822.5 % of GDP for 2007-08
Special Economic Zones (SEZs)Special Economic Zones (SEZs)
▪ SEZ Act is being framed to create cluster of manufacturinginvestors with effective and efficient infrastructure to competeinvestors with effective and efficient infrastructure to competeglobally
• Tax Holidays• Tax Holidays– 10 years for Zone developers– 5 years for investors in the Zone
▪ Duty free imports of plant and machinery
O i d f ilit ff d b BOI▪ One window facility offered by BOI
Year wise FDI Trendswith Privatization Proceedswith Privatization Proceeds
266
133
5000
6000
541015403000
4000
Mill
ion
$
1981
4873
3722
176199
3631000
2000
357622 750
1161128
176
02001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09
Greenfield Investment Privatisation
10
Greenfield Investment Privatisation
Country Wise FDI in PakistanCountry Wise FDI in PakistanUS$ Millions
US$ MillionsCountry 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09
USA 211.5 238.4 325.9 516.7 913.1 1,309.3 875.3
UK 219.4 64.6 181.5 244 860.1 460.2 263.4
U.A.E 119.7 134.6 367.5 1,424.5 661.5 588.6 178.2
Japan 14.1 15.1 45.2 57 64.4 131.2 74.3
Hong Kong 5.6 6.3 32.3 24 32.6 339.8 156.1
Switzerland 3.1 205.3 137.5 170.6 174.7 169.3 227.3
Germany 3.7 7 13.1 28.6 78.9 69.6 76.9
Norway 0.3 146.6 31.4 252.6 25.1 275.0 101.2
11
Others 220.4 130.1 388.1 801.4 2,327.7 1,808.6 1,769.1
Total 798.0 949.0 1,523.9 3,521.0 5,139.6 5,152.8 3,721.8
Country-wise FDI in Pakistan (Jul 09- Mar 10)
Country Million $ % age
USA 443.9 28.6
Netherlands 268.4 17.3 443.9, 29%
284.6, 18%
USAU.K 168.0 10.8
U.A.E 136.8 8.8
Switzerland 103 8 6 778.5, 5%
69.9, 4%
USA
Netherlands
U.K
U.A.E
SwitzerlandSwitzerland 103.8 6.7
Singapore 78.5 5.1
Cayman Island 69 9 4 5 268.4, 17%136 8 9%
103.8, 7%Singapore
Cayman Island
Others
Cayman Island 69.9 4.5
Others 284.6 18.3
Total 1 553 9 100 0
168.0, 11%
136.8, 9%
12
Total 1,553.9 100.0
US$ MillionsSector Wise FDI in PakistanSector Wise FDI in Pakistan
Sector 2002-03
2003-04 2004-05 2005-06 2006-07 2007-
08 2008-09
Oil & Gas 186 8 202 4 193 8 312 7 545 1 634 8 775 1Oil & Gas 186.8 202.4 193.8 312.7 545.1 634.8 775.1
Financial Business 207.4 242.1 269.4 329.2 930.3 1,607.6 707.4
Textiles 26.1 35.4 39.3 47.0 59.4 30.1 36.6
Trade 39.1 35.6 52.1 118.0 172.1 175.5 165.7
Construction 17 6 32 0 42 7 89 5 157 1 88 5 92 5Construction 17.6 32.0 42.7 89.5 157.1 88.5 92.5
Power 32.8 14.2 73.4 320.6 193.4 70.3 119.8
Chemical 86.1 15.3 51.0 62.9 46.1 78.0 74.3
Transport 87.4 8.8 10.6 18.4 30.2 73.0 93.1
Communications(IT & Telecom) 24.3 221.9 517.6 1,937.7 1,898.7 1,625.3 879.1
13
(IT & Telecom)
Others 90.4 170.1 274.0 285.0 1,107.2 769.7 778.2
Total 798.0 949.4 1,523.9 3,521.0 5,139.6 5,152.8 3,721.8
Sector-wise FDI in Pakistan (Jul 09- Mar 10)
Sector Million $ % age
Oil & Gas Exploration 519.9 33.5
Telecommunication 264.1 17.0
326.4, 21%
cation
Financial Business 118.7 7.6
519.9, 33%
76.5, 5%
Oil & Gas Exploration
Telecommunication
Financial Business
Transport
Transport 90.1 5.8
Paper & Pulp 80.5 5.2
Construction 77 7 5 080.5, 5%
77.7, 5%Paper & Pulp
Construction
Chemicals
Others
Construction 77.7 5.0
Chemicals 76.5 4.9
Others 326.4 21.0
264.1, 17%118.7, 8%
90.1, 6%
14
Total 1553.9 100.0
Total FDI Vs FDI in IT & Telecom Sector
6,000.0
4,000.0
5,000.0
US $ Milli
3,000.0Communication(IT&Telecom)Total
Millions
2,000.0
00
1,000.0
Years
15
0.02000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 Jul-Feb 10
Investment O t itiOpportunities
inin Pakistan
16
Investment opportunities
▪ Offshore & Onshore Exploration
▪ Refining
Oil & Gas
▪ Refining▪ Pipelines▪ Storages
▪ Hydel▪ Coal
Priority SectorsPriority SectorsM
inin
g Power
Hydel▪ Thermal▪ Coal▪ Solar▪ Wind▪ Biogas
Coal▪ Granite▪ Marble▪ Copper▪ Semi-
Precious
IT & Telecom▪ BiogasPrecious
Stones
▪ Call centers▪ Cell phone▪ E-Commerce▪ Software▪ IT Parks
17Cont’d….
Investment opportunities
▪ Ports & Roads▪ Urban Mass Transport▪ Water supply &▪ Sanitation▪ Housing▪ Desalination
▪ Textiles ▪ Leather▪ Hotels Infrastructure▪ Electronics▪ Furniture▪ Gemstones▪ Food
ProcessingS t &
Hotels▪ Resorts▪ Theme
Parks▪ Cultural
tourism
Priority SectorsPriority SectorsTo
uris
m SMEs
▪ Sports & Surgical goods
▪ Value added textiles
▪ Entertain-ment Centers
▪ Agri-Business ▪ Livestock & Dairy
T
Agriculture
Livestock & Dairy▪ Corporate Farming ▪ Fisheries▪ Fruits & Vegetables▪ Seed Production▪ Storages
18Cont’d….
Investment opportunities
▪ Oil & Gas▪ Infrastructure▪ Power▪ Industry/ Real Estate
Privatization
y▪ Banking
G lf Cit
▪ Pesticides▪ Dyes▪ Agro Based
Priority SectorsPriority SectorsH
ousi
ngChem
ica
▪ Golf City▪ Water City▪ Sports City▪ Media City▪ Residential
Complexes
Agro Based▪ Mineral
Based▪ Synthetic
Fiber▪ Pharma-
ceuticalsHals
Engineering
▪ Light & Heavy EngineeringA t bil
▪ Office apartments
ceuticals▪ Petrochemical▪ Complex/
Naphtha▪ Cracker
▪ Automobiles▪ Auto parts▪ Agriculture Machinery▪ Steel Production▪ Textile Machinery
19
IT & TelecomIT & Telecom Sector
Emerging IT & Telecom Boom
97 Million cellular users & growing97 Million cellular users & growing
More than 19 million internet users
Above 688,373 Broadband subscribers,
Total direct and indirect jobs in Telecom
sector are 1.36 million
Pakistan emerging regional traffic hub for Middle East Afghanistan & Central AsianMiddle East, Afghanistan & Central Asian Republics
21
I.T & Telecom - Incentives
100% foreign equity allowed insoftware houses
Minimum US $ 0.15 millioninvestment is required in servicesector
Piracy laws to protect softwarey
Tax holiday on software exports till2018
0-5% Custom Duty on imports of PME
22
Initial Depreciation allowance is 50%of PME Cost
I.T & Telecom Development
Software Technology Parks China
Medical & Legal transcriptions
IT Law (digital signatures, Afghanistan
( g ge-commerce, Secure comm.)
Task forces & synergies y g(Health, Agri, Call Centers, Women in IT, IT & PovertyAlleviation, Venture Capital etc.)Alleviation, Venture Capital etc.)
Education (Virtual University, IT Universities IT faculty training IT
IranIndia
23
Universities, IT faculty training, IT curriculum for class IX- onwards)
1707 cities on the internet300 cities on Fibre
Major Telecom Companies in Pakistan
24
List of Mobile Operators
S/N Organization Licensed Region
Brand Name PAKISTAN AJK/NA
1M/s Pakcom Limited Yes No License Instaphone M/s Pakistan Mobile Company
2Mobile Company Limited Yes Yes Mobilink
3 M/s CMPak Limited Yes Yes Paktel M/s Telenor
4 Pakistan Limited Yes Yes Telenor
5M/s Warid Telecom Limited Yes Yes Warid
6
M/s Pakistan Telecom Mobile Limited Yes Yes Ufone M/s Special
25
7
M/s Special Communication Organization No License Yes SCO
List of WLL Service Operators
1 Pakistan Telecommunication Company Limited 2 Telecard Limited. 3 Wi-Tribe Pakistan (Formerly Burraq Telecom Limited)4 DV Com Data (Pvt.) Limited 5 WorldCall Telecom Ltd5 WorldCall Telecom Ltd. 6 Wateen Telecom (Pvt.) Limited 7 Great Bear Int'l (Pvt.) Limited 8 Cyber Internet Services (Pvt.) Ltd 9 Link Direct International (Pvt.) Ltd.
S ( )10 Super Dialogue (Pvt.) Ltd. 11 MyTel (Pvt.) Ltd. 12 Metrotel (Pvt.) Ltd.
26
12 Metrotel (Pvt.) Ltd. 13 Defence Housing Authority
List of LDI OperatorsS # Company Name License StatusS # Company Name License Status 1 Redtone Telecommunications Pak. (Pvt.)
Ltd.Operational
2 Link Direct International (Pvt ) Ltd Operational2 Link Direct International (Pvt.) Ltd. Operational 3 Callmate Telips Telecom (Pvt.) Ltd. Terminated (wef. 28-10-
2008)4 Tele Card Ltd Operational4 Tele Card Ltd. Operational 5 DV Com Ltd. Operational 6 Wise Communication Systems (Pvt.) Ltd. Operational 7 Dancom Pak. (Pvt.) Ltd. Operational 8 Wi-Tribe Pak. Ltd. Operational 9 Wateen Telecom (Pvt.) Ltd. Operational ( ) p
10 Telenor LDI Communications (Pvt.) Ltd. Operational 11 Circle Net Communications (Pvt.) Ltd. Suspended (21-12-2009)12 Multinet Pak (Pvt ) Ltd Operational
27
12 Multinet Pak. (Pvt.) Ltd. Operational 13 4GB Gentel International (Pvt.) Ltd. Operational 14 World Call Telecom Ltd. Operational
Telecom Sector Overview
In budget 2008-09 thetelecom industry taxrates reduced i e GSTrates reduced i.e. GSTfrom 21% to 19.5%and 50% reduction inactivation tax i.e.import duty on mobileimport duty on mobilesets from Rs. 750 toRs. 250.
▪ Telecom sectorrevenue grew by 20percent and generatedRs 327 8 billion asRs 327.8 billion asrevenue
▪ Telecom sector paidR 112 billi t
28
Rs 112 billion as tax
Cont’d….
Telecom Sector Overview▪ Tele density (percentage▪ Tele-density (percentage
of mobile users) ofPakistan stood at 63.5percent showing ap ggrowth rate of 5.4percent.
▪ Foreign DirectForeign DirectInvestment (FDI) stoodat 815 million dollar(2008-09)
▪ Total investments in thesector stood at 1.7 billiondollar
▪ Telecom imports alsogrew by 20 percent andreached 1 6 billion dollar
29
reached 1.6 billion dollar(2008-09)
Cont’d….
Telecom Sector OverviewM bil S t 2009Mobile Sector - 2009
▪ The mobile penetration reached 59 6 percentreached 59.6 percent of the total population
▪ Total mobileTotal mobile subscribers reached approx. 97 million
▪ Prepaid subscription is 98 percent, whereas only 2 percent subscribers are post-paid
30Cont’d….
Telecom Sector Overview
Mobile Sector - 2009
▪ Revenue: cellular revenues grew by 16 percent and stood atpercent and stood at Rs 212 billion at the end of 2008-09
▪ The mobile investments dropped by 48 percent and
h d 1 2 billireached 1.2 billion dollar
31Cont’d….
Telecom Sector OverviewLL d WLL 2009LL and WLL - 2009
▪Basic services (LL. WLL (
& LDI) showed a healthy
revenue growth rate ofrevenue growth rate of
26 percent contributing
Rs 113 billion to theRs 113 billion to the
sector revenue which is
around 34 percent of thearound 34 percent of the
total telecom sector
revenue
32
revenue
Cont’d….
Telecom Sector OverviewLL d WLL 2009LL and WLL - 2009
▪ With the declining trend in g
fixed line tele-density
reaching 2.2 percent with
a total of 3.5 million fixed-
line subscribers in the
country
▪ Wireless local loop (WLL)
tele-density stands at 1.6
percent with 2.65 million
33
subscribers across
Pakistan
World Top Cellular Subscribers - 2009R k Country or Number of mobile P l i % ofRank Country or
regionNumber of mobile
phones Population % of population
— World 4,100,000,000 6,797,100,000 60.61 China 703,000,000 1,335,330,000 52.652 India 506,044,156 1,175,710,000 43.153 USA 276,610,580 308,505,000 894 Russia 190,000,000 141,915,979 134, , , ,5 Brazil 173,960,000 191,480,630 90.846 Indonesia 140,200,000 231,369,500 60.537 Japan 107,490,000 127,530,000 84.117 Japan 107,490,000 127,530,000 84.118 Germany 107,000,000 81,882,342 130.15
9 Pakistan 96,709,585 168,500,500 59.0310 Italy 88 580 000 60 090 400 147 4110 Italy 88,580,000 60,090,400 147.4111 Mexico 79,400,000 109,610,000 72.4412 UK 75,750,000 61,612,300 122.9513 Vi t 70 000 000 87 375 000 80 11
34
13 Vietnam 70,000,000 87,375,000 80.1114 Philippines 67,900,000 92,226,600 73.6215 Turkey 66,000,000 71,517,100 92.29
Internet penetration and users- 2009I t t I t tCountry Internet user
penetration (%)Internet users
(thousand)
Malaysia 57% 15,300Malaysia 57% 15,300Azerbaijan 41% 3,500Indonesia 14% 33,000Mongolia 13% 400
Pakistan 11% 19,000Uzbekistan 10% 2 800Uzbekistan 10% 2,800Tajikistan 10% 650
India 8% 95,000Sri Lanka 7% 1,400Armenia 6% 200
Afghanistan 2% 500
35
Afghanistan 2% 500Nepal 2% 550
Turkmenistan 1% 80
Investment Opportunities in - IT
E- Government Projects
` IT Enabled Services
Call CentersCall Centers
Back Office
GIS Mapping (geographical information system)(geographical information system)
Software Design/ Testing
36Industrial Automation Projects
Cont’d….
Investment Opportunities in - IT
Content Development
Software Products
Distance Learning /Distance Learning / IT Education & Training
Electronic Media
Information SecurityInformation Security
Bureau Services
37
Hardware and Internet Equipments
Investment Opportunities In TelecomUpgrading the Billing Systems
Rural Telecommunications
Value Added Services & Content Services
Data Communications
Internet Protocol TelevisionInternet Protocol Television
Vehicle Tracking System
3 G / 4 G Networks
Low Fixed Line Teledensity
38
Low Fixed Line Teledensity
Cont’d….
Investment Opportunities In TelecomM-Commerce
Advent of Mobile Banking
Tele Medicine and Tele Sale & Purchase
Mobile sets manufacturing
Tele Marketing and Video Conferencing
Network Solution Providers
Underground Exchanges
Telephone Exchanges with DMS
39
p g
Outsourcing and Franchise
Concluding RemarksRaising capital through the stock exchange to expand operations andintroduce new products and services is a tested model of growth anddevelopment.
Adoption of innovative models by the telecom sector to benefitinvestors, general public and the consumer.
The model of expanding business operations through expandingownership and sharing profits with the people is an example worthemulating by the investors.
Expanding of the networks to low teledensity areas and taking thedevelopment revolution a step forward by bringing the under developedregions at par with the urban centers of the country.
Pakistan’s economy remains resilient and Karachi Stock Exchange hasbecome one of the best performers among major emerging markets.
40
Pakistan ranked among the seven attractive emerging markets offering awide range of investment opportunities.
Board of Investment is your one stop shop to address all your investment enquiries
O t ff d t i t dOur staff are ready to assist and facilitate you in helping to achieve your goals and drive Pakistan towards progress andPakistan towards progress and prosperity
41
42